Exam 2 Tools Help Savod Help Save & Exit Subn Petrini Corporation makes one prod

Question

Exam 2 Tools Help Savod Help Save & Exit Subn Petrini Corporation makes one product and it provided the following information to help prepare the master budget for the next four months of operations selling price per unit is $110. Budgeted unit sales for January February, March, and April are 7.500, 10,600, 12000, and 11,700 units, respectively. All sales are on credit b. Regarding credit sales, 30% are collected in the month of the sale and 70% in the following month. C. The ending finished goods inventory equals 30% of the following month's sales. d. The ending raw materia als inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $4.00 per pound e. Regarding raw materials purchases, 40% are paid for in the month of purchase and 60% in the following month. f. The direct labor wage rate is $23.00 per hour. Each unit of finished goods requires 2 6 direct labor-hours g. Manufacturing overhead is entirely variable and is $8.00 per direct labor-hour h. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $70,000. If the budgeted cost of raw materials purchases in February is $222,180, then the budgeted accounts payable balance at the end of February is closest to: Multiple Choice

Explanation / Answer

Regarding Raw Material Purchases, 40% is paid for in the month of purchase & 60% in the following month

Hence Account Payable = Raw Material Purchase * 60%

Feburary Purchases = $222180

A/c Payable = 222180 * 60% = $133308

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.